Councils which continue to publish 'town hall pravda' newspapers could face legal action from the government within weeks.
A total of five local authorities authorities have been put on notice by Eric Pickles and face imminent legal action unless they scale back their publications.
Hackney, Tower Hamlets, Waltham Forest, Newham and Greenwich councils were all instructed last April to comply with government regulations restricting the regular publication of council newspapers
Under government regulations, council newspapers must be published no more than quarterly and must not seek to compete with other local independent publications.
The affected boroughs now face the prospect of possible court orders requiring them to scale back or scrap the papers.
"A small, hard core minority of councils are undermining the free press and wasting taxpayers’ money on political propaganda," Eric Pickles said today.
"Local democracy and localism needs independent journalism to scrutinise councils and hold them to account.
"Parliament has changed the law to allow action to be taken against these Town Hall Pravdas. We have put them on notice that ministers are prepared to use these legal powers, if necessary, after due consideration and process."
A source at the department told Politics.co.uk that although no final decision had been taken, ministers were now 'minded to intervene' against the councils.
However, one of the councils facing the threat of legal action today denied having received any new legal threat from the government.
"Hackney Council sent a comprehensive response to the secretary of state in April this year, setting out the full benefits of circulating Hackney Today to our residents on a fortnightly basis," a spokesperson for the council told Politics.co.uk.
"We did not receive any further response from the government on the matter."
Hackney and other boroughs insist their publications dramatically reduce the cost of publishing statutory notices, required under the law.
Greenwich council recently defended their continued publication of their weekly newspaper Greenwich Time on the basis that publishing statutory notices in the local press would cost them in excess of £1.3 million.
However a leaked letter to the council revealed that one newspaper had actually offered to publish the notices at almost half that cost.
Mercury Newspaper and the South London press also offered to take over Greenwich Time as a going concern, but were rejected out of hand by the council.
Pickles' move was today cautiously welcomed by opposition politicians in the borough.
"I can only hope that the promise to stop Greenwich Time is not another false dawn," leader of Greenwich Conservatives Spencer Drury told Politics.co.uk.
"The Labour council will not stop publishing Greenwich Time without a determined effort from Eric Pickles and he needs to make sure that this happens as soon as possible.
"I estimate that Greenwich Time costs at least £500,000 each year - money which could be spent on things much more important to people in our borough than supporting the Labour party."
Pickles has been accused of waging a political campaign against predominantly Labour councils.
Four of the five boroughs facing imminent action from the government are Labour controlled and the fifth is independent.
However, last month the department wrote to a further seven local authorities across the country, including several Conservative boroughs, warning them to scale back their publication of council newspapers.
Local authorities newly contacted by the department included Conservative-controlled Luton, Medway, Mid Devon and North Somerset councils.